Should You Be Scared That China And Russia Just Agreed To Drop The Dollar?

[Chitownheadbusa]

A older Religious White gentleman mentioned this to me at work today...so I came home to Google some info but couldn't find much. He said that Russia and China hasnt done business similar to this since WW1 or WW2....i forget. But anyways, he then proceeded to quote "End of the World" scenarios out the Bible. Considering the fact that Im not a religious person I had the cut the conversation short.

Here are the only links I could find on this info. None of the major/known media outlets are talking about it. So I dont know how true it is. Anybody hear about this "new deal"?


http://www.marketwatch.com/story/china-russia-to-drop-dollar-in-bilateral-trade-2010-11-23


http://www.businessinsider.com/china-and-russia-drop-dollar-for-bilateral-trade-2010-11

http://www.ibtimes.com/articles/85424/20101124/china-russia-drop-dollar.htm

I apologize for the vagueness.

 

[Notorious P.I.M.P.]

Good post.

You should have posted it on the main board.

I almost missed it because I never come to this forum.

 

[QueEx]

Good post.

You should have posted it on the main board.

I almost missed it because I never come to this forum.

Shows you what you been missing.

QueEx

 

[nittie]

Yeah we should scared this country doesn't control it's destiny anymore. Russia and China can cause the U.S to implode and become a 2nd tier country like the U.S did to them. I think the Obama admin has the smarts to avoid this BUT those suicidal maniacs in the rep party will do everything they can to stop him.

 

[Cruise]

As long as almost every country in the world is an 'active member' of the IMF, this appears more symbolic than anything.

Now, if Russia and China had agreed not to use any dollars in any transaction with any country, it would probably start World War III.

 

[Chitownheadbusa]

Yuan-Ruble Trade Starts as Russia, China Shun Dollar​

December 15, 2010, 3:40 AM EST

By Emma O’Brien and Artyom Danielyan


Dec. 15 (Bloomberg) -- Moscow’s Micex exchange started trading the yuan against the ruble for the first time today, as Russia and China seek to reduce the use of dollars in trade.

The ruble closed at 46.3405 per 10 Chinese yuan by 11 a.m. in Moscow, after opening at 46.35 per 10 yuan shortly after 10 a.m. By the end of trading the volume of transactions amounted to 4.92 million yuan ($738,850), or 22.78 million rubles, according to the index’s data.

Both China and Russia have called for the dollar’s role in global trade to be diminished since the global financial crisis, and Russia is promoting the ruble as a reserve and trading currency within the former Soviet Union. China is allowing greater use of the yuan, which is not yet fully convertible, in international transactions as it seeks to reduce its reliance on the greenback. Asian exchanges that trade palm oil derivatives and gold are starting to accept yuan as payment and collateral.


“This event will become part of history in Russia-China relations, in the history of our financial markets,” Viktor Melnikov, a deputy chairman of Russia’s central bank, said at a ceremony to launch the trade at the Micex headquarters in Moscow, attended by China’s Ambassador to Moscow Li Hui. “No doubt this will become a serious catalyst for economics and trade.”

The Micex, which is Russia’s biggest exchange by volume, expects about 3 million yuan ($450,518) to change hands each day, the exchange’s Vice President Igor Marich said Dec. 6. China allowed the yuan to trade versus the ruble on its interbank market from Nov. 22.

‘Exotic’

“It’s an exotic cross that may develop in importance in the coming years,” Piotr Matys, an emerging markets currency analyst at 4Cast Ltd. said by phone from London today. “The dollar will continue to be the most important trading currency, but obviously given these two countries’ trading relations this step makes sense.”

Chinese companies buying Russian products including timber, seafood and coking coal and Russian companies importing Chinese goods will be the main clients of the yuan-ruble trade, Bank Rossii’s Melnikov said Dec. 6. Clients of Russian banks doing business in China will be able to save as much as 5 percent on transaction costs by buying yuan through the Micex, according to Melnikov.

Chinese Premier Wen Jiabao said in March he was “worried” about holding assets denominated in the greenback. The Bursa Derivatives Berhad, which sets the global benchmark for crude palm oil, started in November to accept Chinese yuan as margin collateral for trading on the Malaysian derivatives market. The Chinese Gold & Silver Exchange will start the first international gold contract in yuan early next year, the Financial Times reported yesterday, citing exchange president Haywood Cheung.

“The launch of this trade is a big deal,” said Ruben Aganbegyan, president of the Micex. “It won’t become the leading currency pair on our market, but it’s the first step in a very interesting direction.”

--Editors: Alex Nicholson, John Kohut.

To contact the reporters on this story: Emma O’Brien in Moscow at eobrien6@bloomberg.net; Artyom Danielyan in Moscow at adanielyan@bloomberg.net




http://www.businessweek.com/news/2010-12-15/yuan-ruble-trade-starts-as-russia-china-shun-dollar.html

 

[thoughtone]

That $700 billion load just added to the deficit didn't help any.

Bigger than the stimulus!

Bigger than "Obama Care"


So that means the concern about the national debt was just a bunch of bullshit, right?

 

[texast]

It's not that big a deal. Only trade directly between Russia and China will be denominated in the respective countries currency. That trade is pretty much insignificant compared to the business China does with the US and Europe, which must be done in dollars or Euro's (and the euro is looking scary compared to the dollar)

 

[Lamarr]

China's Hu Jintao: US Currency System Is 'Product of the Past'

Chinese President Hu Jintao has said the international currency system dominated by the US dollar is a "product of the past".

Mr Hu also said China was taking steps to replace it with the yuan, its own currency, but acknowledged that would be a "fairly long process".

The remarks to two US newspapers come ahead of a state visit by the Chinese leader to Washington this week.

They reflect continuing tensions over currency issues between the two powers.

In a rare interview published in the Washington Post and Wall Street Journal, Mr Hu also reiterated criticism of a decision by the US Federal Reserve to inject $600bn into the economy, which some argue will weaken the dollar at the expense of other countries' exports.

"The monetary policy of the United States has a major impact on global liquidity and capital flows and therefore, the liquidity of the US dollar should be kept at a reasonable and stable level," President Hu said.
'Important contribution'

He meanwhile disagreed with suggestions that letting the yuan appreciate in value would help China to combat inflation.

Beijing has previously come under pressure over its currency from the US, which has accused China of allegedly manipulating the yuan to help boost Chinese exports.

Despite criticism of the current system, Mr Hu said he believed it would be a long time before the yuan - or renminbi (RMB) - was accepted as a global currency.

"China has made important contribution to the world economy in terms of total economic output and trade, and the RMB has played a role in the world economic development," he said.

"But making the RMB an international currency will be a fairly long process."

 

[Cruise]

Why should black people care because green pieces of paper, with white boys' faces on it, is rejected by the rest of the world?

Instead, it should be seen as an opportunity for liberation.

Finally, rather than depend on whites for your daily bread, a roof over your head, and a job... you can rely on your friends, family, and community.

The dollar, or slave paper, is a cruel joke that too many black people take seriously.

 

[fourth_retired]

 

[GET YOU HOT]

Are you suprised...

 

[nittie]

China's Hu Jintao: US Currency System Is 'Product of the Past'

Chinese President Hu Jintao has said the international currency system dominated by the US dollar is a "product of the past".

Mr Hu also said China was taking steps to replace it with the yuan, its own currency, but acknowledged that would be a "fairly long process".

The remarks to two US newspapers come ahead of a state visit by the Chinese leader to Washington this week.

They reflect continuing tensions over currency issues between the two powers.

In a rare interview published in the Washington Post and Wall Street Journal, Mr Hu also reiterated criticism of a decision by the US Federal Reserve to inject $600bn into the economy, which some argue will weaken the dollar at the expense of other countries' exports.

"The monetary policy of the United States has a major impact on global liquidity and capital flows and therefore, the liquidity of the US dollar should be kept at a reasonable and stable level," President Hu said.
'Important contribution'

He meanwhile disagreed with suggestions that letting the yuan appreciate in value would help China to combat inflation.

Beijing has previously come under pressure over its currency from the US, which has accused China of allegedly manipulating the yuan to help boost Chinese exports.

Despite criticism of the current system, Mr Hu said he believed it would be a long time before the yuan - or renminbi (RMB) - was accepted as a global currency.

"China has made important contribution to the world economy in terms of total economic output and trade, and the RMB has played a role in the world economic development," he said.

"But making the RMB an international currency will be a fairly long process."

I wonder what does he mean by a 'fairly long process' China concept of time is different than the West's.

 

[Lamarr]

I wonder what does he mean by a 'fairly long process' China concept of time is different than the West's.

they gotta get their military up. These bankers aint gon give up the privilege of printing the Worlds Reserve currency without a fight or some kind of compromise that favor Rockefellor, JP Morgan & the likes.

 

[Cruise]

they gotta get their military up. These bankers aint gon give up the privilege of printing the Worlds Reserve currency without a fight or some kind of compromise that favor Rockefellor, JP Morgan & the likes.

If that's their plan, it will be grand opening... grand closing for them as a superpower.

The United States model of a cheap oil military is ending precisely because the era of cheap oil is over.

Yet, that is precisely what China expects to build and they think it will last any longer than the US?

The age of the superpower is over, as we know it.

Russia fell. The United States is falling. And now, China wants to be next?

 

[charlie dark]

It makes perfect sense....
Why would they need to use the Dollar for such trade deals???

 

[Lamarr]

If that's their plan, it will be grand opening... grand closing for them as a superpower.

The United States model of a cheap oil military is ending precisely because the era of cheap oil is over.

Yet, that is precisely what China expects to build and they think it will last any longer than the US?

The age of the superpower is over, as we know it.

Russia fell. The United States is falling. And now, China wants to be next?

Who knows what their intentions are? Superpower, who knows? It comes down to the efficient use of military, human, & economic resources.

Will those resources be used in an aggressive manner or simply as a means to protect their citizens?

It will take time but IMO, the US is giving them this Superpower platform more than anything else but we'll see

 

[QueEx]

A older Religious White gentleman mentioned this to me at work today...so I came home to Google some info but couldn't find much. He said that Russia and China hasnt done business similar to this since WW1 or WW2....i forget. But anyways, he then proceeded to quote "End of the World" scenarios out the Bible. Considering the fact that Im not a religious person I had the cut the conversation short.

Here are the only links I could find on this info. None of the major/known media outlets are talking about it. So I dont know how true it is. Anybody hear about this "new deal"?


http://www.marketwatch.com/story/china-russia-to-drop-dollar-in-bilateral-trade-2010-11-23


http://www.businessinsider.com/china-and-russia-drop-dollar-for-bilateral-trade-2010-11

http://www.ibtimes.com/articles/85424/20101124/china-russia-drop-dollar.htm

I apologize for the vagueness.

Well, two years later -- what result ???

Should we have been afraid ???

 

[Lamarr]

The G20 Moscow meeting of finance ministers was another step on the road to destroying the dollar and transforming the International Monetary Fund (IMF) into the Federal Reserve for the world.

Killing the Dollar: G20 & IMF Push for Global Fed, Global Currency

While headline stories about averting the dangers of an international “currency war” dominated news coverage of the recently concluded G20 meeting in Moscow, the real unreported story is that the global gathering of central bankers and finance ministers is pushing forward with their plan for “supersizing” the International Monetary Fund. The end goal is to transform the IMF into a global Federal Reserve, with the ability to flood the world with huge new volumes of loans and currency. It would also wield vast financial regulatory powers.

The IMF’s unit of account, or “currency,” known as a Special Drawing Right (SDR), is being readied for eventual adoption as the replacement for the U.S. dollar in international transactions, to lead the way toward eventual adoption of the SDR or some other designated unit as the global currency, much in the same way that the euro was foisted upon the people of Europe as a replacement of their national currencies.

The mainstream media seem intent on keeping the public fixated on the latest Kardashian frolics, sportsmania, and Dremocrat-Republican political mudwrestling, while coverage of the G7, G20, and IMF confabs that are determining the economic fate of the world receive short shrift. And the little reporting of these events that does leak out usually amounts to little more than regurgitation of the pre-scripted talking points of the conference principals. Over the past four years, The New American has published numerous articles detailing the radical plans currently underway for the total destruction of the dollar and the plans for supersizing the IMF into a global Fed.

IMF as Global Fed: G20's Agenda Behind the Agenda

Obama’s IMF Sneak Attack

"Supersizing" the IMF

Upcoming Financial Summit About Global Governance

 

[thoughtone]

More right wing predictions.

 

[Lamarr]

More right wing predictions.

not a right-wing prediction, but simply an economic observation. Surely, you see the standard of living decreasing? Remember, Obama said he needs 4 more years to "finish the job" (that George Bush Sr. put into place many years ago)

 

[thoughtone]

not a right-wing prediction, but simply an economic observation. Surely, you see the standard of living decreasing? Remember, Obama said he needs 4 more years to "finish the job" (that George Bush Sr. put into place many years ago)

We will see how low the standard of living falls after the ri get finished cutting all government!

 

[Lamarr]

We will see how low the standard of living falls after the ri get finished cutting all government!

you are hopelessly clinging to this left-right false paradigm

BOTH SIDES ARE SCREWING YOU THOUGHT

Smaller govt is what is desperately needed in order to 'free up' land, labor & capital so a REAL recovery can take place

 

[Greed]

Both of you are in denial if you think the results will actually be smaller government. The cuts will make the deficit about $900 billion a year instead of a trillion. That's no more than an accounting trick.

They got you guys thinking the world is at stake.

 

[Lamarr]

Both of you are in denial if you think the results will actually be smaller government. The cuts will make the deficit about $900 billion a year instead of a trillion. That's no more than an accounting trick.

I'm confused, results in what? In a nutshell, these left vs. right arguments are false because the real "item of the day" is how the G-20 is setting the IMF up to become the World's Federal Reserve. Honestly, I'm not even following this 'sequestration' debate, totally off my radar

The demise in the US dollar will ultimately lead to a larger governing body.

 

[Greed]

I'm confused, results in what? In a nutshell, these left vs. right arguments are false because the real "item of the day" is how the G-20 is setting the IMF up to become the World's Federal Reserve. Honestly, I'm not even following this 'sequestration' debate, totally off my radar

The demise in the US dollar will ultimately lead to a larger governing body.

Lamarr and thoughtone are making references to budget cuts.

 

[Greed]

I'm confused, results in what? In a nutshell, these left vs. right arguments are false because the real "item of the day" is how the G-20 is setting the IMF up to become the World's Federal Reserve. Honestly, I'm not even following this 'sequestration' debate, totally off my radar

The demise in the US dollar will ultimately lead to a larger governing body.

You and thoughtone are making references to budget cuts.

 

[Greed]

I'm confused, results in what? In a nutshell, these left vs. right arguments are false because the real "item of the day" is how the G-20 is setting the IMF up to become the World's Federal Reserve. Honestly, I'm not even following this 'sequestration' debate, totally off my radar

The demise in the US dollar will ultimately lead to a larger governing body.

You and thoughtone starting making references to the importance of budget cuts. I think the budget is too far gone to have any cuts matter.

 

[thoughtone]

you are hopelessly clinging to this left-right false paradigm

BOTH SIDES ARE SCREWING YOU THOUGHT

Smaller govt is what is desperately needed in order to 'free up' land, labor & capital so a REAL recovery can take place

You are out of your mind. there is no shortage of land, labor or capital. For the last 30 years the wealth has been transfered from the botton 40% of wage earner to the top 5%. The wealthiest of the wealty are getting wealthier. They are hoarding it.

BTW, I heard Ron Paul say he distrusts democracy.

source: Business Insider


The $2 Trillion Corporate Cash Hoard Is Only Getting Bigger

Much has been made about the $1.9 trillion sitting on the balance sheets of non-financial U.S. corporations.​

And evidence suggests that cash hoard is only getting bigger.​

RBC Capital Market's Myles Zyblock notes that because corporate profitability has been so high, corporations have been able to generate more than enough cash flow from operations to finance all of their capital expenditures.​

"From a flows perspective, capital expenditures are being surpassed by internally generated cash flows at a quarterly annualized rate of ~$200 billion," writes Zyblock. "Thus, companies are still adding significantly to their $1.9 trillion cash mountain." See the chare below:​

RBC Capital Markets​

Much has also been made about corporations returning cash to shareholders by initiating share repurchases, increasing dividends, and introducing new dividends. Even Apple recently jumped into the fray.​

However, most companies are largely financing these dividend and repurchase activities by borrowing money at the ultra-low rates in the highly liquid credit markets.​

RBC Capital Markets​

All of this borrowing is increasing the amount of leverage on corporate balance sheets. Nevertheless, these corporations are having no problems paying there bills. Thanks to record high profit margins and ultra low interest rates, interest coverage ratios (i.e. pre-interest income divided interest expense) are at multi-year highs.​

RBC Capital Markets​

So, there's little to suggest that the record corporate cash loads will be getting smaller anytime soon.​

However, Zyblock also warns that this can't last forever. "[W]ith net margins peaking and an eventual increase in rates, corporations could have trouble servicing this debt load in the future."​

 

[Greed]

The $2 Trillion Corporate Cash Hoard Is Only Getting Bigger

Why is that thoughtone? No human action happens in a vacuum. Why are they hoarding cash? In the 90's they invested the money in all types of nonsense. What's different about now? Is there something about investment opportunities and government policies that are influencing their behavior?

 

[thoughtone]

Why is that thoughtone? No human action happens in a vacuum. Why are they hoarding cash? In the 90's they invested the money in all types of nonsense. What's different about now? Is there something about investment opportunities and government policies that are influencing their behavior?

Tax policy!

However you feel about Clinton in the 1990s, the federal budget had it's first surplus in 20 years and the debt increase was beginning to reverse.

The Bush tax cuts and the wars and unpaid for Medicare Part D put an end to that.

 

[Greed]

Tax policy!

However you feel about Clinton in the 1990s, the federal budget had it's first surplus in 20 years and the debt increase was beginning to reverse.

The Bush tax cuts and the wars and unpaid for Medicare Part D put an end to that.

But companies didn't sit on the cash equivalent of 10% of GDP during the 2000's with half a trillion dollar deficits adding to the debt. Why are they doing it now with trillion dollar deficits? They also seemed fine investing in the America during any time prior to the 90's, when there was still debt and yearly deficits adding to it.

Seems odd doesn't it?

 

[QueEx]

Seems odd doesn't it?

Or, Greed.

 

[Greed]

Or, Greed.

If it's irrational greed, then they will pay a steep price in the long run by missing out on investment opportunities that could benefit their company and investors or miss out on potential customers by not expanding.

Hopefully its just greed and these companies don't see a more ominous future that the rest of us are missing.

 

[thoughtone]

Or, Greed.

If it's irrational greed, then they will pay a steep price in the long run by missing out on investment opportunities that could benefit their company and investors or miss out on potential customers by not expanding.



Hopefully its just greed and these companies don't see a more ominous future that the rest of us are missing.